Microsoft looks to get Nook all to itself for $1 billion

Nook sales haven't been too hot lately.

Microsoft has offered to pay $1 billion to buy the digital portions of Nook Media LLC, according to a report from TechCrunch Thursday. TechCrunch claims to have seen internal documents that suggest Microsoft wants to get its hands on the rest of the digital book business and that Nook Media plans to fade out its Android-based tablets by the end of 2014.

Microsoft bought a 17.6 percent stake in Nook for $300 million almost exactly a year ago, when the digital Nook division split off from Barnes and Noble proper, resulting in a Nook app for Windows 8. Since then, British publishing company Pearson has purchased a 5 percent stake for $89.5 million.

Microsoft appears to want the whole division to itself, though for around $700 million less than the valuation at which it bought into the company ($1.7 billion, last April). Since Microsoft bought in, Barnes and Noble released new Nooks that failed to sell well over the holidays and have since been discounted.

Barnes and Noble also recently added the full Google Play store to its newer Nook HD and HD+ units. But if the company plans to sell and/or discontinue its tablets altogether, the appearance of the play store may not be the beacon of hope it at first seemed to be.

The Nooks are great devices (I had the original tablet, and now have a Nook Simple Touch Glow), but they haven't gotten the marketing they need...or perhaps more pertinently, B&N's digital bookstore hasn't.

Basically from what I have read, B&N will still offer their software, just for other platforms. For Microsoft, this eliminates an Android line, and they probably get a deal to have B&N on their tablets as a featured product. Not sure if this is a good deal for B&N. They have been doing a lot of digital textbooks on their college bookstore side.

Simple, Embrace and extinguish. If you want to read up on a good and little reported example, microsoft's fahrenheit project. SGI did not do so well afterwards.

Also google "Microsoft Dirty Tricks history"

Extinguish what? An ecosystem they don't even compete in?

The amount of brain-dead copypaste responses I see in every Microsoft article is getting nauseating. As a poster above me said, it's pretty clear they want an eBook ecosystem to compete with against Apple and Google in their eBook offerings.

"Extinguishing" Nook doesn't do anything for them. If they purchase it, it'll be to get access to all of the content Nook already has access to and to rebrand it and integrate it into the App stores for Windows Phone and Windows 8.

1. Nooks were Android devices and B&N said they were big proponents of Android.

2. Microsoft sued B&N for using Android, and B&N didn't have money to fight them in court. B&N called Microsoft evil for basically using meritless lawsuits as a form of extortion against Android hardware manufacturers who didn't have the cash to fight back.

3. Microsoft realizes the PR was bad, and offered B&N a deal that included dropping the lawsuit and buying a stake in the Book business.

Why do all these commenters think Microsoft would buy Nook just to get rid of it? That would be doing Amazon a favor, not Microsoft. Microsoft doesn't have a major e-book store or e-reader that Nook is competing with...

I just bought a new 32GB Nook HD+ over the weekend for $199 from Best Buy. I'm planning on having it be my primary comic book reader since it has a glorious screen and access to my Comixology, Kindle, Play, and Nook libraries. Plus, it has an SD slot so I can load all my Marvel Comic PDFs (Marvel and a company called GIT used to sell DVD Roms containing scans/PDFs of complete collections of Spiderman, Fantastic Four, Iron Man etc.)

I'm also hoping the larger screen will make it okay to use as a textbook reader (for programming and math textbooks).

They produced the Kin line of phones. The fact the Kin line of phones was an unmitigated failure is one thing, but they did not buy Danger to get rid of them. They purchased them to produce phone hardware for Microsoft.

Success or not, their intention wasn't to remove them as competitors as you seem to be incorrectly implying with your revisionist history.

They produced the Kin line of phones. The fact the Kin line of phones was an unmitigated failure is one thing, but they did not buy Danger to get rid of them. They purchased them to produce phone hardware for Microsoft.

Success or not, their intention wasn't to remove them as competitors as you seem to be incorrectly implying with your revisionist history.

You read way to much into a one liner.

Suffice to say, history does not repeat itself, but it does rhyme. This is the end of the Nook line.

And Kin was how Danger got killed, they were highly successful pre-acquisition

1. Nooks were Android devices and B&N said they were big proponents of Android.

2. Microsoft sued B&N for using Android, and B&N didn't have money to fight them in court. B&N called Microsoft evil for basically using meritless lawsuits as a form of extortion against Android hardware manufacturers who didn't have the cash to fight back.

3. Microsoft realizes the PR was bad, and offered B&N a deal that included dropping the lawsuit and buying a stake in the Book business.

4. Suddenly B&N loves Microsoft and wants to abandon Android.

That my friends is how Microsoft competes.

Can I borrow that crystal ball of yours? The rest of us don't have that kind of advantage you do in being able to look into Executive's heads and know exactly why they do things.

Letting us into your little secret would really help the rest of us out.

They produced the Kin line of phones. The fact the Kin line of phones was an unmitigated failure is one thing, but they did not buy Danger to get rid of them. They purchased them to produce phone hardware for Microsoft.

Success or not, their intention wasn't to remove them as competitors as you seem to be incorrectly implying with your revisionist history.

You read way to much into a one liner.

Suffice to say, history does not repeat itself, but it does rhyme. This is the end of the Nook line.

And Kin was how Danger got killed, they were highly successful pre-acquisition

The hardware line was already confirmed to be ending by 2014 - regardless of whether Microsoft did anything. Barnes & Noble was losing money as (sadly) the hardware wasn't selling compared to the Kindle.

1. Nooks were Android devices and B&N said they were big proponents of Android.

2. Microsoft sued B&N for using Android, and B&N didn't have money to fight them in court. B&N called Microsoft evil for basically using meritless lawsuits as a form of extortion against Android hardware manufacturers who didn't have the cash to fight back.

3. Microsoft realizes the PR was bad, and offered B&N a deal that included dropping the lawsuit and buying a stake in the Book business.

4. Suddenly B&N loves Microsoft and wants to abandon Android.

That my friends is how Microsoft competes.

Can I borrow that crystal ball of yours? The rest of us don't have that kind of advantage you do in being able to look into Executive's heads and know exactly why they do things.

Letting us into your little secret would really help the rest of us out.

Google is your friend. There are tons of documented stories of B&N calling Microsoft out and now suddenly they're in bed together and B&N is phasing out Android tablets.

That's not what I'm talking about. I'm well aware of the past legal situation between the two companies. I'm calling into question your assertion that Barnes & Noble is abandoning the Nook because of Microsoft.

Perhaps you should use Google for yourself to see that they've been considering ending the hardware line and being a software licensing company for many months now. Not once have they said they'll be abandoning Android so much as they want to get out of the hardware game. Now if Microsoft purchases the entire software unit - they can exclusively use its catalog of content for their ecosystem instead of allowing Barnes & Noble to license out their software to other hardware makers.

It amuses me when I read posts from people who seem to think that 1998 Microsoft was the same company as 2013 Microsoft is today.

You're right.

1998 Microsoft never used patents offensively. Bill Gates vowed so long as he was CEO that it wouldn't ever happen. 2013 Microsoft does.

1998 Microsoft was gaining share in every major market, while bailing out Apple in a move that oddly enough fostered competition. 2013 Microsoft is losing market share in every major market and competes with patent litigation.

I bought a Nook two weeks ago, then started doing some reading on the 'net about it.Based on the fact that, on average, I was not getting a warm, fuzzy feeling (nothing I could put my finger on, specifically), I returned it within the allowed period.Maybe I should play the stock market?

1. Nooks were Android devices and B&N said they were big proponents of Android.

2. Microsoft sued B&N for using Android, and B&N didn't have money to fight them in court. B&N called Microsoft evil for basically using meritless lawsuits as a form of extortion against Android hardware manufacturers who didn't have the cash to fight back.

3. Microsoft realizes the PR was bad, and offered B&N a deal that included dropping the lawsuit and buying a stake in the Book business.

4. Suddenly B&N loves Microsoft and wants to abandon Android.

That my friends is how Microsoft competes.

Can I borrow that crystal ball of yours? The rest of us don't have that kind of advantage you do in being able to look into Executive's heads and know exactly why they do things.

Letting us into your little secret would really help the rest of us out.

Google is your friend. There are tons of documented stories of B&N calling Microsoft out and now suddenly they're in bed together and B&N is phasing out Android tablets.

That's not what I'm talking about. I'm well aware of the past legal situation between the two companies. I'm calling into question your assertion that Barnes & Noble is abandoning the Nook because of Microsoft.

Perhaps you should use Google for yourself to see that they've been considering ending the hardware line and being a software licensing company for many months now. Not once have they said they'll be abandoning Android so much as they want to get out of the hardware game. Now if Microsoft purchases the entire software unit - they can exclusively use its catalog of content for their ecosystem instead of allowing Barnes & Noble to license out their software to other hardware makers.

Again, check the timeline.

Those many months of discussing ending their Android line started with the Microsoft deal. That was 13 months ago.

B&N has proved that "getting with the times" and "adapting your business model for the modern era" isn't sufficient alone. Sometimes you bet big and lose.

If the Nook can still earn back $1Bn, that's a pretty great consolation prize, even if it's still a heartbreaking token of defeat. And if MS can take it forward in any form at all, at least the efforts of the designers and engineers won't have been all for nothing.

Meanwhile, Windows 8 on a tablet seems to me to have a clear future, and it needs an "iBooks." If Nook can be that, it should be able to survive, and comfortably.

Those many months of discussing ending their Android line started with the Microsoft deal. That was 13 months ago.

It started with their sales faltering so badly they decided to give away a free eReader with every HD+ they sold. They didn't start discussing the sale of their hardware business right after Microsoft infused cash into the joint venture. They began discussing it after their dismal holiday sales.

Those many months of discussing ending their Android line started with the Microsoft deal. That was 13 months ago.

...except that many, many other Android manufacturers have been happy to play ball with MS and continue to make Android devices. B&N obviously saw something different, and abandoning Android just because of Microsoft likely wasn't it.

I think that the impulse to see this as Microsoft wanting to kill a competitor is reasonable, but in this case misguided. Nook was already on its deathbed.

Rather, the commenters who are suggesting that Microsoft is doing this to beef up their Media ecosystem are I think closer to the truth. iPad has the iBookstore, so the Surface will need the Microsoft Windows Live Book Store Professional 2015. (The name they choose may be slightly longer.)

But seriously, it's an odd (desperate?) choice for MS to buy this company. The software is 100% Android/Linux, with DRM from Adobe. I suppose it's better than nothing but still -- are they going to rewrite the whole stack? And are they going to pay Adobe for DRM?